SUPREME  COURT  OF  ILLINOIS, 


THIRD  GRAND  DIVISION,  APEIL  TEEM,  A,  D,  1867, 


FRANKLIN  PARMELEE,  et  al,  APPELLANTS. 

vs. 
DANIEL  LAWRENCE,  APPELLEE. 

BRIEF  FOR  APPELLEE  ON  RE-HEARING. 

MAY  IT  PLEASE  YOTJK  HONORS: 

The  argument  made  in  the  petition  for  a  re-hearing  in  behalf 
of  Mr.  Lawrence  seems  to  be  all  that  need  be  said  on  the  subject 
of  the  fraud  in  the  procurement  of  the  release  being  such  a  fraud 
as  a  court  of  equity  will  take  cognizance  of. 

Neither  in  the  oral  argument  on  the  re-hearing,  nor  in  their 
printed  argument,  have  the  counsel  for  the  appellants  attempted 
to  contravert  the  positions  we  have  assumed,  and  they  seem  to  be 
so  fully  impressed  with  the  equity  and  legality  of  Mr.  Lawrence's 
claims  that  they  urge  not  a  word  against  them,  except  to  say 
that  there  are  technical  points  upon  the  pleadings  in  this  case 
which  present  insuperable  obstacles  to  the  decree  for  a  foreclosure 
which  we  so  confidently  ask  your  honors  to  direct. 

To  their  te.cb.mcal  arguments  I  shall  reply  after  calling  at- 
tention to  a  few  authorities  additional  to  those  which  I  cited  in 
the  petition,  to  the  proposition  that — 


"  If  one  party  was  in  fact  ignorant  of  the  law,  and  the  other 
party  knowing  him  to  be  so,  and  knowing  the  law,  took  advan- 
tage of  such  ignorance  to  mislead  him  by  a  false  statement  of 
the  law,  it  would  constitute  a  fraud." 

This  is  a  proposition  universally  announced  and  acted  upon  in 
courts  of  equity. 

In  Broadwell  vs.  Broadwell  (1  Gilm.  608)  the  court  states  as 
settled  law  that  fraud  may  as  well  be  committed  in  an  intentional 
misrepresentation  of  the  law  as  of  the  facts. 

The  case  of  Cathcart  vs.  Robinson  (5  Peters,  264)  is  another 
case  directly  in  point. 

It  is  cited  by  Judge  Caton  in  the  case  of  Broadwell  vs.  Broadwell 
and  approved. 

If  Judge  Caton,  (1  Gilm.,  609,)  referring  to  Cathcart  vs. 
Robinson  correctly  states  the  law,  it  is  decisive  against  the  appel- 
lants ;  change  the  names  of  the  parties,  and  his  words  are : 
"There  could  have  been  no  middle  ground  in  Bigelow's 
conduct,  between  impropriety  and  fraud,  because  if  Bigelow 
had  the  same  understanding  of  the  effect  of  the  release  which 
Mr.  Lawrence  had,  his  silence  was  in  no  wise  blameable,  while  if 
he  was,  in  fact,  aware  of  its  true  legal  effect,  his  suppression  of 
that  information  was  a  clear  fraud." 

The  case  would  be  much  stronger  if  the  party  made  actual 
suggestions  to  create  the  mistake.  Such  was  Bigelow's  con- 
duct. Actual  suggestions  may  be  made  as  well  by  acts  as 
words,  and  the  proofs  show  the  production  of  several  releases 
under  the  pretence  that  the  last  was  entirely  different  in  its  oper- 
ation from  the  first.  This  was  an  actual  suggestion,  and  this  is 
proven  without  reference  to  Lawrence's  sworn  answer. 

The  evidence,  which  in  Cathcart  vs.  Robinson,  was  thought  by 
Marshall,  C.  J.,  to  prove  that  Robinson  did  know  the  true  effect 
of  the  agreement  in  question  in  that  suit,  was  very  much  less 
direct  and  positive  than  the  evidence  in  the  case  at  bar  which 
proves  Bigelow's  knowledge. 

Besides  the  testimony  of  Mr.  Gregory  wnich  is  direct  to  show 
that  Bigelow  was  well  advised  of  the  effect  of  a  release;  and  the 
fact  of  his  having  the  appellants'  attorney  with  him,  all  the  circum- 
stances— Bigelow's  interview  with  Mr.  Gregory  aj  Iris  office,  and 
his  mendacious  statements  to  Mr.  Gregory  before  the  Master  in 


Chancery,  denying  that  he  had  counsel  to  assist  him  in  drawing  the 
release,  and  the  clandestine  meetings  of  Bigelow  and  McAllister 
in  New  York  and  Boston,  and  the  various  releases  put  at  Lawrence, 
and  the  immediate  use  of  the  release  for  a  purpose  contrary  to 
Mr.  Lawrence's  declared  intention  and  understanding  of  its  mean- 
ing, clearly  show  a  deliberate  purpose  to  defraud. 

The  following  cases  in  Illinois  imply  (though  they  do  not  decide 
the  point)  that  misrepresentation  or  mistakes  in  the  law,  accom- 
panied with  imposition  practiced  upon  the  mistaken  party,  are 
ground  of  relief  for  cause  of  fraud  :  Ruffner  vs.  McCounel,  17 
Ills.  216  ;  Gordere  vs.  Downing,  18  Ills.  493  ;  Shatter  vs.  Davis, 
13  Ills.  398. 

In  "Wheeler  vs.  Smith,  9  Howard  55,  a  release  of  title  was 
declared  void  on  bill  filed  by  the  heir,  because  the  executors  mis- 
represented the  law  to  him.  See  Sparks  vs.  White,  7  Hump.  8(5 ; 
Bank  of  F.  S.  vs.  Daniel,  12  Peters  56, 

And  this  rule  of  equity  that  a  party  will  be  relieved  against  a 
contract  made  in  consequence  of  fraudulent  misrepresentation  of 
law,  is  not  confined  to  the  confidence  incident  to  the  formal  rela- 
tions of  attorney  and  client,  etc.,  it  is  applicable  to  all  cases 
where  confidence  on  one  hand  and  influence  on  the  other  exist, 
from  whatever  cause.  McCormick  vs.  Malin,  5  Blackf.  523,  citing 
several  cases  to  the  point. 

These  cases  are  cited,  not  with  a  view  to  show  that  the  Court 
will  give  any  affirmative  relief  to  Lawrence  ou  his  answer,  further 
than  that  which  results  from  the  application  of  these  cases  in  de- 
termining what  a  Court  of  Equity  regards  as  fraud,  and  in  pro- 
curing the  dismissal  of  the  complainant's  bill  on  the  ground  of 
fraud. 

This  rule  of  law  was  not  recognized  by  this  Court  in  its  opin- 
ion in  this  case  as  announced  at  the  last  term ;  and  the  fact  of 
fraud,  though  in  issue,  was  not  distinctly  found  ;  and  should  the 
case  rest  upon  that  opinion,  the  litigation  between  the  parties  to 
this  record  might  be  prolonged  most  needlessly. 

The  law  and  the  evidence  established  the  fraud,  and  it  is  but 
justice  to  Lawrence  that  the  Court  should  find  the  fact,  and  de- 
clare the  rule  of  law  which  governs  the  case.  All  the  parties  will 
then  know  it  and  rest  satisfied.  The  practice  of  the  Court  is  to 
state  their  reasons,  and  in  these  reasons  to  lay  down  the  law  upon 
which  the  case  ought  to  be  disposed  of. 


This  practice  is  so  common  that  I  cite  the  first  c?.se  that  comes 
to  hand,  to  show  that  the  court  will  be  careful  not  to  prejudice 
any  of  the  parties  by  a  failure  to  assign  tho  true  ground  of  dis- 
missal. See  Piersoll  vs.  Elliott,  6  Pet.,  100.  This  is  precisely 
our  case  in  principle. 

If  this  court  had  said,  as  the  Lord  Chancellor  said  in  Ker  vs. 
Dungannon,  cited  by  appellants'  counsel,  "  the  instrument  is  void 
for  the  fraud,  which  is  shown  to  have  been  used  by  the  plaintiff 
in  suppressing  the  truth,  or  in  expressing  a  falsehood,  and  the 
bill  is  dismissed  therefor,"  can  it  be  doubted  that  this  matter  of 
the  release,  so  far  as  the  ejectment  suit  is  concerned,  would  be 
settled  ?  But  the  court  took  a  middle  ground,  and  said  what  is 
apparent  to  any,  even  an  unenlightened  conscience,  that  the  case 
was  unconscionable  and  iniquitous,  but  did  not  put  its  decision 
plainly  on  the  ground  of  fraud.  Now,  if  ejectment  should  be 
brought,  and  no  further  decision  on  this  matter  be  had,  the 
parties  in  the  suit  at  law  would  be  ignorant  as  to  what  was  res 
adjudicata  in  this  suit. 

If  Lawrence  had  filed  a  bill  to  set  aside  the  release,  solely  on 
the  grounds  proven  in  this  case,  these  authorities  go  to  show  that 
the  court  would  have  set  it  aside  as  void  for  fraud.  Hence  these 
cases  have  been  cited ;  and  not  because  it  is  expected  that  any 
decree  will  be  made  in  the  original  and  supplemental  cause  in 
Lawrence's  favor  ;  which  is  represented  by  Mr.  Beckwith  in  his 
argument  on  the  re-hearing  to  be  what  the  appellee  expects  this 
court  to  do. 

He  represents  such  to  be  our  motion,  and  then  cites  his  author- 
ities to  show  that  the  court  will  not  grant  affirmative  relief  upon 


an  answer 


The  cases  therefore,  which  he  cites  to  this  effect,  have  no  im- 
portance, except  to  be  used  to  knock  down  this  man  of  straw 
which  he  has  set  up. 

II. 

Answer  to  argument  of  Appellants'  counsel  on  the  re-hearing: 

Much  that  is  said  by  the  adverse  side  needs  no  reply,  further 
than  the  allusion  already  made  to  it.  The  sophistry  of  appellants' 
argument  is  too  glaring  to  need  pointing  out.  As  one  instance 
of  this  sophistry,  it  represents  this  court  as  granting  a  re-hearing 


"  at  the  instance  of  a  defendant  after  a  decree  dismissing  the 
complainants'  bill  upon  the  merits ;"  and  then  the  counsel,  not 
awai'e  of  the  bad  taste  in  so  doing,  mistakenly  represent  the 
court  as  placing  the  parties  in  a  "ridiculous  position"  by  grant- 
ing such  re-hearing.  Mr.  Lawrence,  the  complainant,  for  the 
purpose  of  getting  that  affirmative  relief,  without  circuity, 
which  his  case  legally  and  equitably  demands  in  this  suit,  asks 
the  court  to  modify  their  opinion,  and  rescind  their  order  dis- 
missing his  cross-bill,  and '  to  give  him  a  foreclosure  ;  and  this 
position  is  represented  by  appellants'  counsel  as  a  defendant 
complaining  because  the  court  had  granted  all  he  asked. 

Mr.  Beckwith  says,  "  the  petition  for  a  re-hearing  insists  that 
the  release  in  controversy  was  obtained  by  fraud  and  misrepre- 
sentation ;  and  that  by  reason  thereof  the  appellants  should  in 
some  unknown  manner  be  restrained  from  using  it."  Then  he 
adds,  "  the  record  is  so  framed  that  no  adjudication  can  be  had 
on  the  matter  of  fraud." 

His  argument  is  that  "  Lawrence's  answer  was  sufficient  to  put 
in  issue  the  execution  of  the  release,  but  it  was  not  sufficient  to 
defeat  its  operation  ;  a  deed  once  established  is  always  acted  up- 
on by  a  court  of  equity  until  it  is  set  aside." 

The  attempt  is  made  to  keep  out  of  view  the  fact  that  the 
answer  of  Lawrence  put  in  issue  the  fraud  in  the  release.  That 
it  was  in  issue  in  the  original  cause  I  shall  waste  no  words  to 
show. 

III. 

The  fraud  being  in  issue  and  proven,  and  the  original  and  sup- 
plemental bill  dismissed,  it  only  remains  to  see  : 

1st.  Was  there  any  need  of  another  issue  of  fraud  between 
Bigelow,  Gage  and  Parmelee,  and  Lawrence,  in  the  cross 
cause  ? 

2d.  Was  ther.e  need  that  Lawrence  thould  file  a  cross-bill  to 
set  aside  the  release  ? 

It  is  apparently  conceded  by  the  adverse  side  that  if  the  an- 
swer to  these  two  questions  shall  be  in  the  negative,  Mr.  Law- 
rence is  entitled  to  have  the  order  of  the  court  set  aside  by  which 


his  cross  bill  was  dismissed,  and  a  decree  for  foreclosure,  and 
that  his  debt  should  be  paid  by  the  original  complainants  and 
Johnson. 

These  questions  must  both  be  answered  iu  the  negative. 
The  first  we  answer  in  a  later  part  of  the  argument.  We  will 
now  notice  the  cases  cited  in  the  affirmative  of  the  second 
question. 

It  is  insisted  for  appellants  that  Lawrence  must  file  a  cross- 
bill to  rescind  the  release. 

I  will  not  needlessly  enlarge  this  brief  by  citing  cases,  but 
content  myself  with  saying  that  the  position  is  absurd ;  that  no 
necessity  in  reason  is  shown  for  the  application  of  a  rule  which 
may  well  be  followed  where  a  case  is  made  to  which  the  rule 
applies. 

They  cite  :  Jacobs  vs.  Richards,  18  Beavan  300;  Eddlestone  vs. 
Collins,  3  De  G.  McK  &  Gord.  1;  Hartshorn  vs.  Day,  19  How. 
211;  Ker  vs.  Lord  Dungannon,  1  Dr.  &  War.  509;  O'Roy  vs. 
Warner,  Hayes  571. 

These  were  cited  to  show  that  a  cross  bill  was  necessary  ;  if 
examined  they  will  be  found  not  to  bear  the  counsel  out. 

Eddleston  vs.  Collins,  was  a  case  of  a  foreclosure  suit  brought 
by  Eddlestone.  The  Vice  Chancellor  had  decided  that  the  mort- 
gage was  valid  and  the  defendants  appealed.  Upon  the  appeal 
the  Lord  Chancellor  stated  the  case  to  be  that  the  defense  at- 
tempted was  that  the  mortgage  (a  surrender  of  the  copyhold 
estate  by  way  of  mortgage)  was  void,  because  the  deputy  steward 
who  took  the  surrender  was  an  infant  under  the  age  of  twenty- 
one  years. 

The  Lord  Chancellor  examined  this  proposition,  and  decided 
that  there  was  no  legal  invalidity  in  the  surrender  for  that  cause, 
though  the  infancy  was  a  fact. 

"  The  defendants  next  say,"  he  proceeds,  "that supposing  there 
be  no  objection  by  reason  of  the  infancy  of  the  deputy  steward 
and  that  the  power  given  by  the  surrender  has  been  from  time 
to  time  properly  executed,  still  it  has  only  been  properly  execu- 
ted in  form,  for  that  in  truth  Mrs.  Collins  was  imposed  upon  and 
did  not  know  what  she  was  executing ;  that  the  surrender  was 
never  explained  to  her,  and  that  she  did  not  moan  to  do  more 


-  7 

than  authorize  the  raising  of  the  additional  £100  beyond  the  first 
£50,  which  was  ex  concessis  a  good  advance. 

"  If  that  were  so,  though  perhaps  the  more  strict  course  would 
have  been  to  file  a  cross-bill  to  set  aside  the  transaction,  yet  I 
conceive  the  point  may  be  raised  by  way  of  defence  by  saying  for 
what  sum  the  plaintiff  is  to  be  considered  as  a  mortgagee" 

His  Lordship  examined  the  evidence  of  fraud,  and  concludes — 
"  I  therefore  think  on  this  point,  the  defendants  have  failed,  and 
that  there  is  nothing  leading  to  the  conclusion  that  any  fraud 
was  practiced."  Then  Lord  Justice  Turner  said  he  concurred 
with  the  Lord  Chancellor  in  the  foregoing  so  far  as  regards  the 
validity  of  the  surrender  and  the  lack  of  proof  of  fraud,  and  upon 
the  attempt  of  defendants  to  impeach  the  mortgage  security,  he 
said  he  felt  great  doubt  whether  it  is  competent  to  them  to  do  so, 
and  then  uses  the  language  quoted  in  appellants'  brief  on  page  5, 
and  finally  remarks  that  it  is  competent  for  the  court  to  grant  the 
defendants  the  indulgence  to  file  a  cross-bill ;  but  holds  that 
there  are  circumstances  in  the  case  which  disentitle  them  (the 
debtors)  to  any  indulgence  from  the  court,  and  he  concurs  in  the 
opinion  that  the  appeal  ought  to  be  dismissed. 

The  point  therefore  was  not  raised  in  the  case,  hence  it  fur- 
nishes no  illustration  of  the  conditions  under  which  the  rule 
alluded  to  is  applied.  The  counsel  miss  the  point.  The  only 
important  question  is — does  any  such  rule  apply  to  the  case  at 
bar? 

The  case  also  differs  from  the  case  at  bar.  In  Eddleston  vs. 
Collins,  the  title  to  the  land  had  been  passed  to  the  plaintiff,  by  a 
deed  of  conveyance  :  The  instrument  which  is  impeached  in  the 
case  at  bar  is  but  a  pretended  evidence  of  payment  and  does  not 
convey  title,  and  therefore  the  complainants  at  bar  asked  the 
court  for  an  active  decree  to  put  the  title  out  of  Lawrence  and 
into  them  in  violation  of  the  express  intention  of  the  release! 

The  cases  would  be  more  analogous  if  Bigelow  had  fraudu- 
lently succeeded  in  obtaining  a  conveyance  of  the  title  from 
Lawrence  to  appellants.  Then  it  might  be  admitted  that  it 
would  have  been  necessary  for  Lawrence  to  file  a  bill  to  set  aside 
the  conveyance,  before  he  could  get  a  foreclosure.  The  objection 
of  the  Lord  Chief  Justice  above  referred  to  is  precisely  this, 
that  a  decree  for  conveyance  from  the  plaintiff'  to  the  defendant, 
would  be  an  anomaly,  if  granted  upon  an  answer  merely. 


8 

Jacbbs  vs.  Richards,  does  not  bear  out  the  counsel,  if  examined. 
Richards  mortgaged  some  property  to  Jacobs  in  1848.  In  1852, 
Richards  was  found  by  inquisition  to  have  been  a  lunatic  from 
1825.  One  of  the  defenses  was  that  the  mortgage  being  exe- 
cuted by  a  lunatic  was  invalid. 

The  Master  of  the  Rolls  stated  :  "  I  apprehend  there  are  two 
principles  upon  which  this  court  acts  and  which  are  rather  prin- 
ciples of  practice  than  of  law,  and  have  been  adopted  for  the 
convenience  of  conducting  suits.  One  is,  that  when  a  deed 
prima  facie  good  at  law  is  brought  before  it,  this  court  in  the 
exercise  of-  its  ordinary  functions  and  jurisdiction,  acts  on  it 
until  it  has  been  set  aside.  The  other  is,  that  this  court  does  not 
give  the  defendant  active  relief."  Then  he  examined  the  ques- 
tion whether  the  mortgage  deed  had  been  proven  in  the  case, 
and  decided  that  it  had  been  proven  by  the  subscribing  witness, 
and  prima  facie  it  was  valid. 

"  The  only  question  to  be  asked  is  whether  the  party  executed 
the  deed  in  the  witness'  presence.  The  defendants  have  not 
thought  fit  to  cross-examine  the  witness  which  might  have 
destroyed  his  evidence,  and  I  have  therefore  a  deed  proved  in 
the  ordinary  way  by  the  attesting  witness. 

"The  defence,  however,  is  that  this  is  no  deed  :  first,  because 
it  is  overreached  by  the  finding  in  lunacy  ;  and  secondly,  because 
the  plaintiff  is  bound  to  prove,  and  has  not  proved  the  sanity  of 
the  person  who  executed  it.  I  have  not  found  any  case  in  which 
it  said  that  this  court  will  not  act  on  a  deed  overreached  by  an 
inquisition  of  lunacy,  where  it  is  proved  by  the  attesting  wit- 
ness, and  where  there  is  no  evidence  that  at  the  time  when  the 
deed  was  executed  the  person  was  not  competent  to  execute  the 
deed." 

The  case  of  Ker  vs.  Lord  Dungannon,  1  Dru.  &  War.  509,  is 
an  instructive  case  on  this  subject,  but  unfortunately  for  the 
appellants,  it  does  not  support  the  position  assumed  by  appellants' 
counsel. 

The  case  may  be  briefly  stated  thus :  Lord  Duugannon 
brought  ejectment  against  Ker  for  the  purpose  of  defeating  a 
lease  made  by  Lord  Dungannon's  great  grandfather  under  wlii/h 
Ker  held  possession.  Ker  filed  a  bill  to  enjoin  the  proceeding  at 
law,  claiming  under  the  lease  and  stating  a  case  which  raised  a 


question  of  the  construction  of  the  will  of  the  former  Lord 
Dungannon,  the  lessor. 

The  defendant  to  the  bill,  by  his  answer,  submitted  that  he 
was  entitled  to  the  premises,  etc.,  and  among  other  things 
"impeached  the  lease  as  having  been  unduly  and  improperly 
obtained  for  under  value." 

No  cross-bill  was  filed  to  set  aside  the  lease.  The  Lord  Chan- 
cellor decided  that  the  taking  of  the  lease  in  that  case  was  a 
fraud,  and  that  Ker  was  to  be  treated  as  a  paid  agent,  receiver 
and  trustee,  attempting  to  reap  the  benefit  of  a  fraudulent  dealing 
with  the  tenant  for  life.  He  therefore  declared  the  lease  void 
and  said  "  although,  therefore,  no  cross-bill  has  been  filed,  I  shall 
unhesitatingly  refuse  all  relief,  and  this  independently  of  the 
question  of  construction,  I  therefore  dismiss  the  bill  with  costs." 
See  page  541. — Ib. 

The  Lord  Chancellor  says,  "  but  I  consider  it  to  be  a  well-set- 
tled principle,  that  if  a  man  has  an  actual  interest,  and  has  come 
into  this  court  for  the  removal  of  legal  temporary  bars,  and  the 
defendant  in  his  answer  sets  up  as  a  defence  that  the  original 
grant  ought  not  to  have  been  executed,  in  general  he  will  not  be 
allowed  to  impeach  the  grant  (i.  e.  the  title  or  actual  interest]  in 
such  a  way,  but  must  file  a  cross-bill;"  but  here  the  parties  ask 
your  honors,  upon  a  fraudulent  release,  to  remove,  (not  a  tem- 
porary legal  bar)  but  the  equities  and  title  of  Lawrence. 

Now,  if  the  argument  of  Mr.  Beckwith  were  carried  to  its 
legitimate  result,  and  were  carried  to  the  point  to  which  he  insists 
it  goes,  then  in  Lord  Dungannon's  case  the  complainant  ought  to 
have  prevailed  so  far  as  the  case  stood  independent  of  the  con- 
struction of  the  will,  for  the  lease  was  established  and  no  cross- 
bill was  filed  to  set  it  aside. 

I  do  not  forget  that  no  court  will  give  affirmative  relief  on  a 
fraudulent  instrument  in  favor  of  the  party  setting  it  up  to  reap 
the  benefit  of  his  fraud,  and  that  the  Chancellor  dismissed  Ker's 
bill  on  that  ground,  and  that  this  court  dismissed  appellants'  sup- 
plemental bill  on  a  similar  ground.  But  counsel  have  cited  it  to 
show  that  a  cross-bill  is  necessary,  and  I  say  that  neither  Ker's 
case,  nor  any  of  the  cases  cited,  is  authority  for  saying  that  in 
this  case  at  bar  there  is  the  slightest  reason  for  Lawrence's  filing 
;i  bill  to  rescind  the  release. 


10 

But  I  apprehend  it  will  always  be  found  that  where  the  deed 
relied  on  by  the  complainant  is  shown  to  have  been  fraudulently 
obtained,  he  will  get  no  advantage  from  it  in  a  court  of  equity, 
even  though  it  be  not  set  aside  by  an  active  decree  in  favor  of 
the  party  against  whom  it  is  sought  to  be  used ;  more  especially 
is  this  true  when  the  fraud  comes  out  in  the  evidence  which  the 
complainant  adduces  to  prove  the  execution  of  the  deed  as  is  true 
in  the  cause  at  bar.  Hartshorn  vs.  Day  is  not  in  point,  it  states 
a  familiar  rule  at  law  ;  is  a  law  case,  and  throws  no  light  on  the 
question  as  applied  to  such  an  instrument  as  the  one  at  bar, 
pleaded  as  this  is. 

The  counsel  also  says  gratuitously,  it  is  admitted  that  the 
release  must  operate  pro  tanto  !  Where  does  he  find  this  admis- 
sion? We  have  contended  that  it  is  void  for  the  fraud  and 
operates  not  at  all.  So  far  as  the  payment  of  money  on  account 
is  concerned,  Mr.  Lawrence  admits  that  fact  in  his  answer. 
Bigelow's  payment  was  only  a  part  payment  of  a  debt  justly  due, 
and  he  did  only  what  the  law  would  have  compelled  him  to  do  in 
making  this  payment ;  the  money  was  Lawrence's  ex  eqiio  et  bono. 
Hence  Lawrence  cannot  be  called  on  to  repay  the  money.  If 
Lawrence  were  in  a  position  to  be  called  upon  to  make  restitu- 
tion before  the  release  could  be  treated  as  null,  then  he  ought  to 
be  required  to  file  a  bill  and  tender  what  would  be  equitable  on 
his  part.  But  such  is  not  the  case  at  bar.  It  is  only  a  question 
of  the  amount  of  the  debt  remaining  unpaid. 

Upon  page  6  of  their  brief,  the  counsel  for  appellants  crave 
the  court  to  disregard  the  effect  of  the  evidence  which  the  appel- 
lants themselves  introduced  into  both  the  original  and  the  cross- 
cause  as  to  the  circumstances  under  which  the  release  was 
obtained.  They  were  not  able  to  prove  their  release  without 
showing  the  ear-marks  of  fraud,  and  now  they  ask  the  indulgence 
from  the  court  to  excuse  them  from  the  effects  of  such  evidence. 

Whether  they  can  ask  any  grace  and  indulgence  of  this  court 
in  face  of  their  iniquitous  claims,  iniquitous  from  the  first  exhibi- 
tion of  their  bill  till  their  crowning  shame,  I  leave  the  court  to 
determine.  There  is  some  hardihood  in  the  request,  it  seems  to 
me  ;  nor  do  I  understand  how  the  court  could  disregard  the  evi- 
dence tending  to  prove  the  issue. 

It  is  unnecessary  to  refer  to  the  counsel's  remarks  upon  the 
power  of  the  court  to  make  a  declaratory  order,  since  we  do  not 


11 

desire  any  such  order.     All  we  want  is  a  foreclosure  decree  in 
this  suit. 

IV. 

Can  Lawrence  have  a  foreclosure. 

I  shall  no\v  answer  the  second  part  of  the  appellants'  argument. 
The  court  is  asked  to  bear  in  mind  that  the  sole  argument  of  the 
learned  counsel  is  a  technical  one  ;  that  a  mere  technical  objec- 
tion is  raised  here  in  favor  of  parties,  whose  "  whole  cause  is 
tainted  and  corrupted  with  injustice  and  iniquity,"  to  quote  the 
language  which  the  court  applied  to  this  case. 

Therefore  I  shall  assume  that  if  the  court  can  give  Mr.  Law- 
rence the  relief  which  he  asked  to  have  in  this  suit,  without 
doing  violence  to  any  invariable  rule  of  practice  or  principle  of 
law,  the  court  will  gladly  seize  the  occasion  to  do  so. 

With  the  purpose  to  show  that  Lawrence  cannot  have  a  fore- 
closure in  this  cause  the  positions  of  counsel  for  appellants  are: 

1.  (a)  The  cross  cause  is  a  separate,  independent,  and  distinct 

suit. 

(b)  And  this  is  so  because  all  the  parties  to  the  cross-bill  are 
not  parties  to  the  original  and  supplemental  bill. 

2.  Johnson,  the  new  party,  properly  pleaded  the  release  by 

supplemental  answer,  and 

y.   (c)  The  question  of  fraud  in  the  release  was  not  in  issue  as 
against  Johnson. 

(d)  The  question  of  fraud  was  in  no  way  in  issue  as  against 
any  of  the  defendants  to  the  cross-bill. 

4.          That  it  was   necesssary  there  should    be   a   cross-bill 
brought  by  Lawrence  to  rescind  the  release. 

1  a.b.  No  objection  could  be  made  to  the  cross-bill  of  Lawrence 
as  not  being  a  pure  cross-bill  if  it  were  not  that  Johnson  was  intro- 
duced as  a  new  party.  But  I  apprehend  it  is  too  late  to  overturn 
the  repeated  affirmance  by  this  court  of  the  rule  laid  down  in  Jones 
vs.  Smith,  14  Ills.  229,  and  in  Kurd  vs.  Case,  32  Ills.  49,  as  to 
introducing  a  new  party  into  a  cross-bill.  Under  our  practice 
such  a  bill  is  by  reason  of  such  new  party  none  the  less  to  be 


12 

treated  as  a  pure  cross-bill  as  to  those  who  are  parties  to  both 
the  original  and  cross-bill.  What  is  said  about  the  practice  of 
Courts  of  Chancery  of  other  States  need  not  be  answered.  It  is 
an  instance  of  irrevelant  discussion  on  the  part  of  the  adverse 
counsel,  indulged  in  not  alone  on  this  point  but  on  others  also. 
In  Fleece  vs.  Russell,  13  Ills.  31,  it  is  held  that  under  our  statute 
(Rev.  Stat.  ch.  21,  §§  24  to  30)  no  process  is  necessary  to  summon 
the  parties  to  an  original  bill,  to  answer  to  a  cross-bill,  and  that 
the  latter  is  an  adjunct  or  part  of  the  original  suit,  the  whole 
together  constituting  but  one  case. 

It  is  also  there  held  that  an  order  dismissing  a  cross-bill  is 
interlocutory,  and  such  an  order  is  not  subject  to  review  until  the 
whole  case  is  disposed  of. 

The  provisions  of  our  statute  were  passed  since  the  decision  in 
the  case  of  Ballance  vs.  Underbill,  3  Scam.  454,  which  appellants 
counsel  rely  on;  and  irrespective  of  the  statute  the  cross-bill  and 
original  bill  is  regarded  as  one  suit.  This  case  only  means  that 
the  rules  ot  pleading  should  be  observed  in  all  the  parts  of  the 
cause. 

The  cross-bill  is  but  auxiliary,  to  set  the  court  in  motion  to  do 
complete  justice  between  plaintiff  and  defendant  in  the  suit. 

The  position  of  the  opposite  counsel  is  at  variance  with  all 
authorities  on  this  point.  Daniels  Ch.  PI.  and  Pr.,  Ch.  xxxiv, 
p.  1647  et  seq.,  new  ed.,  §  1742  old  ed. 

2  &  3  c-  Johnson  never  pleaded  the  release  in  such  a  way  that 
he  could  avail  himself  of  it  in  the  cross  suit.  The  release  was  a 
fact  that  arose  after  the  answer  to  the  cross-bill  was  filed  by 
Johnson.  See  p.  p.  70  and  40  printed  abstract. 

Johnson,  to  avail  himself  of  its  use,  should  have  filed  a  bill  in 
the  nature  of  a  supplemental  bill.  Taylor  vs.  Titus,  2  Edw.  Ch. 
135;  Daniels  Ch.  PI.  and  Pr.  1,  p.  781,  Notes;  Story  Eq.  PI. 
§  903;  Miller  vs.  Fentou,  11  Paige  Ch.  19,  and  cases  there  cited. 

It  so  happens  in  this  case  that  the  opposite  counsel  have  gone 
into  much  irrevelant  discussion,  so  far  as  Johnson  is  concerned, 
from  want  of  acquaintance  with  the  record,  and  from  want  of 
candor  and  accuracy  in  stating  the  rules  of  practice. 

Parties  who  come  to  courts  for  remedies  are  required  to  do  so 
in  a.  mode  allowed  by  law.  For  wise  reasons  the  law  has  pre- 
scribed modes  in  which  the  rights  of  parties  are  to  be  asserted, 


13 

and  a  rigid  adherence  to  established  rules  in  this  respect  is  not 
only  matter  of  convenience  in  the  administration  of  justice,  but 
is  essential  .to  protect  the  rights  of  parties.  A  more  signal 
instance  of  the  irrevelant  discussion  into  which  counsel  may  fall 
by  a  disregard  of  this  rule  can  hardly  be  adduced  than  is  shown 
in  the  argument  of  the  opposite  counsel.  The  positions  asserted 
by  the  adverse  side,  in  this  case,  may  lead  this  court  to  establish 
a  precedent  pregnant  with  mischief  in  future  suits,  and  unjust 
to  Mr.  Lawrence  in  this  suit  unless  caution  is  observed.  It  is  not 
important  to  decide  whether  it  was  within  the  discretion  of  the 
court  to  permit  Johnson  to  plead  the  release  by  a  supplemental 
answer;  since  Johnson  did  not  even  ask  the  leave  of  court  to 
set  up  the  release  in  any  way.  But  the  question,  as  one  of  prac- 
tice, is  important.  I  cite  some  authorities  to  show  that  an  answer 
is  not  the  proper  mode.  The  question  arises  as  to  Gage,  Par- 
melee  &  Bigelow's  answers ;  as  to  those,  we  say  they  were  super- 
fluous as  well  as  improper  in  point  of  practice. 

It  is  an  invariable  rule  that  leave  of  court  must  first  be  obtained 
before  a  supplemental  answer  can  be  filed.  Fulton  Bank  vs. 
Beach,  6  Wend.  36;  Thomas  vs.  Doub.,  1  Md.  323;  1  Daniels,  Ch. 
PL  &  Pr.,  785 ;  or  an  amended  bill  filed. 

The  motion  for  leave  to  file  :i  supplemental  answer  must  be 
accompanied  with  an  affidavit.  Thomas  vs.  Doub.,  1  Md.  323  ; 
McKim  vs.  Thompson,  1  Bland.  150. 

In  case  the  answer  is  filed  without  leave  of  court,  or  impro- 
perly filed,  the  proper  motion  on  the  part  of  the  complainant  is 
to  move  to  take  the  answer  from  the  files  unless  he  is  willing  to 
accept  it  and  join  in  issue.  1  Daniels,  Ch.  PL  &  Pr.,  p.p.  784, 
785,  and  authorities  in  the  note,  3d  Am.  ed. 

A  supplemental  answer  improperly  filed  is  treated  as  a  nullity. 
Fulton  Bank  vs.  Beach,  Ib. 

Johnson  never  moved  for  and  never  obtained  any  leave  of 
court  to  file  his  pretended  supplemental  answer,  but  on  Septem- 
ber 22,  1865,  Johnson  by  his  solicitors,  Goodrich,  Fai'well  and 
Smith,  who  were  not  the  solicitors  of  the  other  parties,  foisted 
into  the  cause  a  paper  purporting  to  be  a  separate  supplemental 
answer,  of  Johnson,  setting  up  the  release  in  his  behalf  alone. 
See  page  70  printed  abstract. 

No  affidavit  was  ever  filed  laying  the  foundation  for  this  sup- 
plemental answer  so  far  as  Johnson  was  concerned,  and  no  notice 


14 

was  given  to  Lawrence's  solicitor  of  any  intention  of  Johnson  to 
file  a  supplemental  answer. 

Lawrence  did  not  treat  this  paper  as  a  pleading;  in  the  case, 
and  filed  no  replication  thereto,  but  on  the  llth  of  January,  1866, 
before  the  cause  was  heard,  Lawrence  filed  his  motion  in  writing 
to  strike  the  said  paper  from  the  files,  and  on  the  12th  of  January, 
made  his  motion  in  court  orally  for  this  purpose.  See  Record, 
p.  324. 

The  court  took  this  motion  under  advisement  after  argument, 
and  decided  it,  among  other  questions,  by  rendering  a  decree 
against  Johnson. 

It  will  be  found  by  reference  to  printed  abstract,  p.  09,  that 
Gage,  Parmelee  <fe  Bigelow,  moved  for  and  obtained  leave  to  file 
their  answers.  The  record  will  be  searched  in  vain  for  any  notice 
to  Lawrence's  solicitor  of  Johnson's  intention  to  file  such  supple- 
mental answer,  and  none  was  ever  served  ;  it  will  be  searched  in 
vain  for  any  motion  for  leave  to  file  the  same,  or  any  order 
granting  leave. 

No  such  proceedings  were  ever  had.  Johnson,  therefore,  is  to 
be  treated  as  not  having  pleaded  the  release. 

This  is  a  good  answer  to  all  that  is  said  upon  the  opposite  side 
with  a  view  to  demonstrate  that  this  court  cannot  render  a  fore- 
closure decree  against  Johnson. 

3  d.  Which  was  the  proper  course  to  have  been  adopted  by  Gage, 
Parmelee  and  Bigelow  ?  Was  it  to  file  a  bill  in  the  nature  of  a 
supplemental  bill,  or  to  file  supplemental  answers  ?  We  say  they 
could  only  bring  in  the  new  matter  of  this  nature,  by  bill,  in  the 
nature  of  supplemental  bill. 

Mr.  Beckwith  says  the  parties  to  the  cross-bill  could  adopt 
either  method,  or  both  methods.  He  cites  several  cases  to  show 
this. 

These  authorites  do  not  prove  the  practice  to  be  as  he  asserts. 

In  Grant  vs.  Scott,  10  Paige  Ch.  K,  486,  the  Chancellor  said 
that  "  the  proper  course  was  to  authorize  the  defendant  to  bring 
forward  such  defence  (his  discharge  in  bankruptcy  after  answer 
was  in)  by  a  cross-bill,  and  thereby  to  give  the  complainants  in 
the  original  bill  an  opportunity  to  set  up  the  fraud  by  the  answer 
to  such  cross-bill."  This  is  one  of  the  cases  cited  by  the  oppo- 
site counsel. 


15 

The  reference  to  Story's  Eq.  PI.,  §  903,  is  as  to  supplemental 
answer  setting  up  some  matter  of  account  which  has  been  pre- 
viously omitted,  and  discovered  since  answer, — a  very  different 
case.  We  are  speaking  of  matter  of  defense  arising  after  answer. 
In  the  same  section,  Story  states  the  rule  to  be  as  we  have  stated 
it.  Bousfield  vs.  Patterson,  which  is  cited,  seems  not  adequate 
authority  in  point,  the  fact  set  up  was  probably  but  matter  of 
course  and  not  deemed  important  for  controversy. 

In  Smith  vs.  Smith,  4  Paige  Ch.  438,  the  point  was  not  raised, 
the  language  of  the  court  was  obiter ;  besides  the  fact  there 
alluded  to  was  such  that  a  simple  replication  was  all  that  could  be 
necessary. 

The  reference  to  Barb.  Ch.  Pr.,  1,  p.  166,  shows  only  that  the 
adverse  side  took  the  citations  without  marking  the  distinction 
between  collateral  matter,  such  as  discharge  in  bankruptcy,  or 
probate  of  will,  upon  which  no  controversy  arose,  and  matter 
which  involves  the  merits  of  the  whole  case. 

But  such  authority  as  can  be  found  on  the  point  where  the 
question  has  been  considered  any  more  than  in  a  passing  remark, 
and  where  the  fact  to  be  pleaded  is  one  of  importance,  is  to 
the  effect  that  cross-bill,  or  bill  in  the  nature  of  supplemental 
bill,  is  the  proper  pleading,  and  for  the  good  reason,  that  if  answer 
is  allowed,  the  complainant  would  be  obliged  to  file  cross-bill  to 
meet  the  defence,  or  else  lose  the  benefit  of  such  issues  as  he 
might  wish  to  raise,  and  which  he  could  not  raise  by  replication ; 
for  it  would  be  inconsistent  to  amend  his  original  bill  to  meet  it. 

The  true  rule  is  stated  in  Miller  vs.  Fenton,  ante,  and  applied 
in  Grant  vs.  Scott,  ante,  and  in  Taylor  vs.  Titus,  2  Edw.  Ch.,  135  ; 
Story's  Eq.  PL,  §  903. 

In  Taylor  vs.  Titus,  the  bill  was  filed  to  compel  defendants  to 
foreclose  a  mortgage,  etc.  After  answer  of  defendants  was  put 
in,  defendants  prayed  leave  to  put  in  further  and  supplemental 
answer  to  the  bill,  setting  forth  satisfaction  of  the  mortgage  occur- 
ring since  answer. 

The  Vice  Chancellor  said :  "  It  is  not  the  practice  to  allow 
matter  which  has  arisen  after  the  filing  of  the  original  answer  to 
come  in  under  a  supplemental  answer.  In  cases  where  some- 
thing has  been  overlooked,  or  inadvertently  left  out,  the  court, 
upon  proper  affidavits  and  a  good  cause  shown,  will  give  leave  to 


16 

a  defendant  to  file  a  supplemental  or  further  answer,  instead  of 
adding  by  amendment. 

"But  here  is  new  matter  which  has  arisen  since  the  filing  of  the 
original  answer.  In  such  a  case,  the  defendant  cannot  set  it  up 
in  a  supplemental  answer,  he  should  file  a  bill  in  the  nature  of  a 
supplemental  cross-bill.  The  practice  is  laid  down  in  Mitf.  PI., 
p.  p.  72,  98  (last  English  and  Am.  ed.)" 

The  case  of  Miller  vs.  Fenton,  11  Paige  Ch.,  19,  is  precisely  in 
point,  and  authorities  there  cited  are  to  the  same  effect. 

I  do  not  think  the  supplemental  answers  cut  any  figure  in  the 
case.  Lawrence  treated  them  as  surplusage,  for  the  reason  that 
the  supplementary  bill  furnished  to  complainants  all  the  advanta- 
ges which  their  answer  could  furnish  ;  but  I  am  willing  to  con- 
sider the  question  for  a  brief  space,  to  show  the  utter  insignifi- 
cance of  the  points  of  the  adverse  side.  Now  the  question 
remains, — what  was  the  effect,  in  the  cross-cause,  of  the  supple- 
mental answers  of  Gage,  Bigelow  and  Parmelee,  considering  the1 
cause  as  a  pure  cross-cause  as  to  them  ? 

Suppose  for  the  moment  that  Lawrence  took  issue  on  them  ; 
then  the  execution  of  the  release  would  be  in  issue  on  the  supple- 
mental answers.  There  is  no  other  effect.  To  be  sure  the  same 
issue  was  also  made  on  the  supplemental  bill.  But  the  question  of 
fraud  was  presented  in  issue  by  the  answer  to  the  supplemental 
bill,  and  issue  was  joined  thereon  by  Gage,  Parmelee  and  Bige- 
low, and  the  issue  of  fraud,  I  will  assume,  is  found  against  them ; 
for  the  fraud  is  made  out  upon  their  own  showing. 

Thus  we  see  that  the  position  of  the  adverse  counsel  that  the 
question  of  fraud  was  in  no  way  in  issue  as  against  any  of  the 
defendants  to  the  cross-bill  is  unsound. 

The  same  evidence  which  they  used  in  the  original  cause  they 
also  used  in  the  cross-cause.  This  is  true  in  point  of  fact,  and 
Mr.  Beckwith  concedes  it  on  page  6  of  his  brief,  but  craves  the 
court  to  overlook  the  effect  of  it. 

That  evidence — the  release  and  its  immediate  use  for  a  dis- 
charge of  all  parties,  contrary  to  the  express  understanding  of 
Lawrence,  as  proved  by  McAllister,  and  the  testimony  of  McAl- 
lister, and  the  fact  that  Bigelow  knew  the  law  of  Illinois — a^fact 
to  be  presumed  from  his  residence  in  Illinois,  and  his  having  the 
complainants'  attorney  with  him  to  draw  the  different  releases — 


17 

makes  the   fraud  apparent,  and  the  ignorance  of  Lawrence  is 
made  out  by  the  release  itself. 

Now  then,  the  argument  of  Mr.  Beckwith  is,  that  whatever 
may  be  the  evidence  of  fraud  in  the  original  cause  as  against 
Bigelow,  or  against  Gage,  Parmelee  and  Bigelow,  and  although 
the  same  evidence,  showing  fraud,  is  adduced  by  themselves  in 
the  cross-cause,  and  although  it  is  the  practice  of  Courts  of 
Chancery  to  make  but  one  decree  in  a  case  where  there  is  an 
original  and  cross-bill,  as  he  must  concede,  yet,  that  the  court, 
while  it  might  in  this  case  dismiss  the  supplemental  bill  on  the 
ground  that  this  release  was  obtained  by  fraud,  will  yet  in  the 
same  decree  adjudge  that  the  same  fraudulent  release  is  a  good 
bar  in  equity  against  a  claim  for  foreclosure  because,  forsooth, 
and  merely  because,  its  execution  was  proven  and  the  fraud 
was  not  twice  put  in  issue,  and  twice  tried  on  the  same  hearing  ! 

Suppose  fraud  had  been  put  in  issue  in  the  cross-cause  in  the 
manner  contended  for  by  Mr.  Beckwith,  could  not  the  court  see  that 
the  result  would  be  the  same  as  in  the  original  cause  ?  It  would 
be  an  idle  farce  to  go  through  with.  To  my  mind,  these  positions 
of  his,  if  true,  would  make  a  farce  of  this  suit. 

Courts  should  give  every  party  a  fair  opportunity  to  meet  by 
proper  proofs  every  issue  that  is  raised  against  him;  but  if 
an  issue  is  squarely  presented  between  two  parties,  with  every 
opportunity  afforded  each  to  sustain  his  own  side  of  the  issue, 
and  the  issue  is  made  out  by  one  party  in  his  favor,  it  ought  to 
be  conclusive  between  such  parties  for  all  the  purposes  of  that 
litigation. 

The  authorities  hold  this  doctrine  everywhere,  and  the  cases 
everywhere  hold  the  cross-cause  and  original  cause  to  constitute 
one  suit  only,  and  only  one  decree  is  usually  made  in  such  a  case. 

I  contend  that  the  issue  of  fraud  and  the  whole  question  of  the 
release  was  made  between  Lawrence  on  one  side,  and  Gage, 
Parmelee  and  Bigelow  on  the  other  side,  in  the  whole  cause,  in 
the  precise  way  in  which  the  best  authorities  hold  that  it  should 
be  made,  and  that  is  upon  the  supplemental  bill,  and  the  answer 
of  Lawrence  thereto. 

But  these  parties  chose  also  to  plead  the  same  matter  in  a 
double  method.  Now,  it  remains  for  this  court  to  say  whether 
the  filing  of  the  supplemental  answers  by  Gage,  Parmelee  and 


16 

JBigelow,  which  Mr.  Lawrence  did  not  accept  as  good  pleading, 
and  which  he  properly  (we  submit)  moved  to  strike  from  tlu- 
tiles,  can  deprive  Mr.  Lawrence  of  the  benefit  on  the  hearing, 
and  in  the  final  decree  of  the  issues  which  were  properly  made 
in  the  cause  on  the  supplemental  bill  and  answer.  It  is  simply 
preposterous.  Yet  the  appellants  are  driven  to  maintain  the 
affirmative. 

4.  As  to  a  cross-bill  to  rescind  the  release,  we  have  shown 
above  that  no  precedent  is  cited  for  such  a  course,  and  that  it  is 
unreasonable  and  useless. 

What  is  the  reason  of  the  general  rule  requiring  a  cross-bill  to 
be  filed  ?  Is  it  not  filed  for  the  purpose  of  bringing  all  the  parties 
before  the  court  who  may  be  interested  in  the  deed  ?  Is  it  not 
that  the  party  asserting  the  fraud  may  raise  this  issue,  and  may 
also  obtain  discovery  from  his  adversary,  and  may  in  a'proper  case 
be  compelled  to  do  equity  ?  And  finally,  will  it  ever  be  required 
by  a  court  of  equity  that  such  a  bill  should  be  filed,  unless  the 
court  can  see  that  some  useful  end  is  to  be  gained  by  it  whicli 
cannot  be  as  well  gained  without  resort  to  such  a  bill  ? 

How  does  the  matter  stand  here  ?  Johnson  does  not  plead  the 
release.  Bigelow,  Gage  and  Parmelee  have  set  it  up  in  a  bill, 
and  fraud  has  been  pleaded  and  proven.  The  fraud  was  availa- 
ble to  Lawrence  by  way  of  answer,  to  defeat  the  supplemental 
bill,  and  that  defeated,  his  right  to  foreclosure  was  clear. 

Lawrence  needed  no  decree  of  rescission  in  his  favor ;  and  this 
because  he  had  not  conveyed  any  title  by  which  his  right  to  ,a 
foreclosure  was  lessened ;  the  instrument  itself  contemplated  a 
foreclosure  sale.  Lawrence  has  no  equity  to  tender  on  his  part. 
The  money  paid  by  Bigelow  was  paid  ex  debito,  and  to  decree 
Lawrence  to  pay  it  back  would  be  an  outrage,  besides  useless, 
since,  the  supposition  is,  it  must  be  paid  back  again  to  him  after 
the  instrument  has  been  rescinded. 

None  of  the  reasons  which  demand  a  cross-bill  for  rescission 
exist  in  this  case. 

All  the  court  has  to  do  is  to  say  that  the  debtors,  in  setting  up 
the  release  which  goes  to  the  quantum  of  debt  remaining  unpaid,' 
under  the  circumstances  do  not  show  a  good  discharge.  One 
party  asserts  it  is  discharged.  The  other  says  the  discharge  is 
not  such  in  its  literal  meaning,  and  that  the  release  cannot  operate 


I 

at  all,  because  the  fraud  in  its  procurement  estops  all  those  who 
set  it  up  from  availing  themselves  of  it. 

V. 

In  the  matter  of  the  release,  it  may  also  be  observed  that : 
Matter  of  law  of  another  State  is  matter  of  fact. 

3  Pars,  on  Cont.  399,  5th  ed. ;  King  vs.  Doolittle,  1  Head.  77  ; 
Bank  of  Chillicothe  vs.  Dodge,  8  Barb.  233;  Merchants' Bank  us. 
Spalding,  12  Barb.  302 ;  Leslie  vs.  Baillie,  2  Younge  &  C.  Ch. 
91;  Haven  vs.  Foster,  9  Pick.  112;  Norton  vs.  Harden,  3 
Shepley,  45. 

Mistake  and  misrepresentation  of  law  of  another  State  is  mis- 
take and  misrepresentation  of  fact. 

As  to  foreign  law,  unwritten  law  is  matter  of  fact  as  much  as 
statute  law.  Greenleaf  on  Ev.,  vol.  1,  §  488. 

VI. 

Interest  Question. 

The  question  as  to  what  interest,  Mr.  Lawrence  is  entitled  to 
receive  is  discussed  at  page  17,  et  seq.  of  the  brief  filed  in  his 
behalf  at  the  April  term,  1866,  in  this  case. 

We  there  argued  that  upon  reason  and  upon  authority,  ten  per 
cent,  should  be  allowed,  all  penalties  and  forfeitures  having  been 
abolished.  To  cut  down  the  interest  below  ten  per  cent,  would 
be  to  create  a  forfeiture,  since  it  would  be  taking  away  from  the 
lender  some  part  of  interest  which  he  could  have  legally  received. 
Our  Supreme  Court  seem  to  have  so  decided  in  Matthias  vs. 
Cook,  31  Ills.  83;  and  the  Supreme  Court  of  Michigan  have 
directly  decided  this  in  Smith  vs.  Stoddard,  10  Mich.  148. 

The  principle  we  contend  for  results  from  these  considerations 
— that  the  interest  statutes  were  not  passed  to  enable  parties  to 
make  contracts  for  the  loan  of  money  at  interest.  At  common  law 
they  could  reserve  any  rate.  Neither  do  the  interest  laws  of  '45 
and  '49  declare  any  part  of  the  contract  void,  but  under  the  law 
of  '45  there  was  a  penalty  of  a  three-fold  forfeiture  for  usury; 
now  that  penalty  taken  away  leaves  the  act  of  '49  simply  with  an 
implied  prohibition,  as  to  the  excess  above  ten  per  cent,  in  the 
contract. 


20 

Farwell  vs.  Meyer,  35  Ills.  40,  was  cited  on  the  other  side  to 
show  that  all  the  interest  falls  when  the  contract  cannot  be 
enforced  as  it  is  rande  :  such  a  rule  was  applicable  to  the  state  of 
the  law  under  which  that  case  arose.  It  was  the  interest  law  of 
'57  which  was  there  in  question,  and  that  law  expressly  declares 
that  no  interest  shall  be  recovered  if  more  than  ten  per  cent,  is 
reserved,  and  there  the  borrower  had  to  pay  six  per  cent,  as  the 
condition  upon  which  he  could  obtain  relief. 

In  Cushman  vs.  Sutphen,  35  Ills.  188,  also,  no  interest  as  such 
was  allowed  the  lender,  because  he  repudiated  the  contract  of 
loan  and  set  up  on  his  part  that  the  transaction  was  a  sale;  there 
was  no  interest  agreement  established,  but  the  mortgagor  had  to 
pay  six  per  cent,  to  redeem. 

The  language  of  the  court  applicable  to  those  cases  would  not 
be  applicable  to  the  case  at  bar. 

Since  that  brief  was  filed  the  Legislature  of  1867  have  passed 
an  act  which  declares  that  no  forfeiture,  except  of  the  excess 
above  ten  per  cent,  shall  be  suffered  in  such  a  case  as  the  one 
at  bar,  and  that  no  part  of  the  interest  which  has  been  paid 
upon  the  contract  shall  be  deducted  from  the  principal.  It  is 
only  where  the  lender  attempts  to  enforce  the  collection  of 
usurious  excess  in  contracts  embraced  by  this  act  that  a  deduc- 
tion is  allowed;  but  the  law  says  that  if  the  debtor  has  volun- 
tarily paid  usury,  it  cannot  be  deducted  from  the  principal. 

For  this  act  see  Myers'  Ed.  Laws  of  Ills,  of  1867,  p.  81. 

This  act  has  rendered  any  reasoning  on  the  question  of  interest 
unnecessary.  It  absolutely  fixes  the  rate  the  court  shall  allow 
where  usury  has  been  reserved. 

The  only  question  remaining  is  whether  such  a  law  is  con- 
stitutional ? 

Such  a  law  is  binding  upon  courts  and  parties.  Andrews  vs. 
Russel,  7  Blackford,  474,  and  cases  cited ;  Seegar  vs.  Seegar,  19 
Ills.  122,  and  see  Justice  Breese's  opinion,  p.  123. 

There  is  no  vested  right  in  penalties  which  will  prevent  the 
Legislature  from  taking  them  away.  Butler  vs.  Palmer,  1  Hill 
330  and  cases  cited;  Yeaton  vs.  United  States,  5  Cranch.  281 ; 
4  Denio  375,  377,  and  note;  State  vs.  Banks,  12  Rich  (L.)  609; 
Morse  vs.  Goold,  1  Kernan,  N.  Y.,  281 ;  Williams  vs.  Waldo,  3 
Scam.  268;  Delahay  vs.  McConnel,  4  Scam.  158;  Baugher  vs. 


21 

Nelson,  9  Gil.  (Md.)  309.  "  There  is  no  vested  right  to  resist 
the  performance  of  a  moral  obligation  " — applied  to  usury. 

In  such  a  case  as  the  present,  every  just  mind  will  feel  only 
regret  that  a  Court  of  Chancery  cannot  punish  those  who  would 
thus  violate  their  agreements,  and  having  violated  their  solemn 
obligations,  would  still  further  defraud  one  to  whom  gratitude  was 
due  for  his  confidence  and  his  assistance  in  a  time  of  need  But 
though  the  court  cannot  punish,  and  cannot  even  prevent  such 
parties  from  making  money  by  enforcing  through  litigation  the 
continuance  of  a  loan  for  years  after  the  money  is  due,  yet  the 
court  can  now  apply  the  law  in  such  a  way  as  will  enable  Mr. 
Lawrence  to  obtain  the  measure  of  interest  which  the  parties  in 
the  articles  of  agreement  contracted  to  pay. 

The  question  as  to  the  proper  enforcement  in  equity  of  the 
qualified  release  was  assumed  to  be  necessarily  involved  in  this 
case.  As  it  is  not  important,  so  far  as  this  case  is  concerned,  I 
shall  not  argue  the  question,  but  it  may  very  properly  be  suggested 
that  to  hold  the  release  in  question,  a  discharge  of  all  is  sustained  by 
no  precedent  in  a  Court  of  Chancery  that  has  been  cited,  or  so  far 
as  I  know  exists.  The  technical  rule  at  law  is  not  a  reason  why 
a  court,  in  the  exercise  of  chancery  jurisdiction,  should  not 
enforce  a  contract  according  to  its  evident  intention,  as  expressed 
in  its  very  terms,  when  such  contract  is  not  opposed  to  public 
policy  or  good  morals,  or  prohibited  by  the  statute,  and  where 
none  of  the  parties  thereto  can  equitably  object  to  such  enforce- 
ment. To  hold  that  it  could  not  so  enforce  it  is  to  ignore  the 
fact  that  the  objects  of  chancery  embrace  those  cases  where 
courts  of  ordinary  jurisdiction  are  made  instruments  of  injus- 
tice. Tt  is  not  a  question  of  construction  which  certainly  ought 
not  to  be  one  thing  at  law  and  another  thing  at  equity ;  there  is 
no  room  for  construction,  the  meaning  is  plain ;  it  is  only  the 
means  of  enforcement  that  is  involved  in  the  question.  A  court  of 
law  can  only  proceed  to  a  direct  and  indivisable  judgment,  but 
a  court  of  chancery  can  carry  out  the  intention  by  means  of  its 
power  of  entering  a  several  decree,  and  arriving  at  the  very 
right  of  the  matter,  to  protect  all  equally,  doing  injustice  to  none. 

Will  your  honors,  therefore,  desire  to  make  such  a  precedent 
in  this  case? 


22 

In  conclusion,  I  respectfully  ask  your  honors  to  decide  that 
the  release  was  fraudulently  procured,  and  hence  void,  and  to 
dismiss  the  supplemental  bill  therefor ;  to  rescind  the  order  dis- 
missing Lawrence's  cross-bill;  to  reverse  the  decree  below; 
to  decree  the  usual  foreclosure  and  payment  of  the  money;  to 
decree  that  Lawrence  shall  retain  the  interest  paid  him  up  to 
April  1,  1861,  and  shall  recover  the  principal  and  ten  per  cent, 
per  annum  thereon  from  that  date  to  August  12,  1864;  that 
$22,557  should  then  be  deducted  from  the  sum,  as  paid  on  the  last 
mentioned  day ;  and  decree  for  the  remainder  with  ten  per  cent, 
per  annum  till  the  entering  of  the  deci*ee,  including  $152  with 
interest  at  six  per  cent,  per  annum  from  September  1, 1863,  being 
money  paid  by  Lawrence  for  insurance  premiums.  We  earnestly 
request  that  the  decree  may  be  rendered  in  this  court,  and  thus 
save  the  delay  of  remanding  the  cause. 
Respectfully  submitted, 

CHAS.  A.  GREGORY, 

Counsel  for  Mr.  Lawrence. 


